Elisa’s Half-Year Financial Report January–June 2022
ELISA CORPORATION HALF-YEAR FINANCIAL REPORT RELEASE 15 JULY 2022 AT 8:30 AM
Second quarter 2022 financial highlights
- Revenue increased by EUR 37m to EUR 522m, mainly due to growth in mobile and digital services as well as equipment sales.
- Mobile service revenue increased by 7.2 per cent to EUR 228m.
- Comparable EBITDA grew by EUR 7m to EUR 179m.
- Comparable EBIT increased by EUR 8m to EUR 113m.
- Comparable cash flow decreased by EUR 20m to EUR 81m, mainly due to a negative change in net working capital.
- In Finland, mobile post-paid ARPU increased to EUR 21.0 (20.8 in the previous quarter), and mobile post-paid churn decreased to 15.3 per cent (17.2).
- During the quarter, the number of post-paid mobile subscriptions increased by 52,300, of which 26,800 were M2M and IoT subscriptions.
- Prepaid subscriptions increased by 15,900 during the quarter.
- The number of fixed broadband subscriptions decreased by 6,600 during the quarter.
- The guidance for 2022 is unchanged.
Key indicators
| EUR million | 2Q22 | 2Q21 | Δ % | 1H/22 | 1H/21 | Δ % | |
| Revenue | 522 | 484 | 7.7 % | 1,033 | 966 | 6.9 % | |
| EBITDA | 177 | 166 | 6.7 % | 354 | 336 | 5.5 % | |
| Comparable EBITDA (1 | 179 | 172 | 4.3 % | 356 | 342 | 4.3 % | |
| EBIT | 111 | 100 | 12.0 % | 223 | 202 | 10.5 % | |
| Comparable EBIT (1 | 113 | 105 | 7.7 % | 225 | 207 | 8.4 % | |
| Profit before tax | 108 | 96 | 12.3 % | 217 | 196 | 10.7 % | |
| Comparable profit before tax (1 | 110 | 102 | 7.9 % | 219 | 202 | 8.5 % | |
| EPS, EUR | 0.55 | 0.49 | 12.0 % | 1.10 | 1.00 | 10.0 % | |
| Comparable EPS, EUR | 0.56 | 0.52 | 7.7 % | 1.11 | 1.03 | 7.9 % | |
| Capital expenditure | 67 | 67 | -0.6 % | 125 | 120 | 4.6 % | |
| Net debt | 1,431 | 1,379 | 3.8 % | 1,431 | 1,379 | 3.8 % | |
| Net debt / EBITDA (2 | 2.0 | 2.0 | 2.0 | 2.0 | |||
| Gearing ratio, % | 135.4 % | 133.8 % | 135.4 % | 133.8 % | |||
| Equity ratio, % | 35.3 % | 35.8 % | 35.3 % | 35.8 % | |||
| Cash flow (3 | 82 | 101 | -18.9 % | 135 | 151 | -10.5 % | |
| Comparable cash flow (4 | 81 | 101 | -19.5 % | 147 | 161 | -8.4 % | |
1) 2022 excluding EUR 2m and 2021 excluding EUR 6m in restructuring costs. 2) (Interest-bearing debt – financial assets) / (four previous quarters’ comparable EBITDA). 3) Cash flow before financing activities. 4) 1H/22 excluding EUR 12m in share investments and 1H/21 excluding EUR 10m in share investments.
Additional key performance Indicators are available at elisa.com/investors (Elisa Operational Data.xlsx).
CEO Veli-Matti Mattila: Growth continued in all business areas
Elisa continued its solid development. Revenue increased by 8 per cent from the previous year to EUR 522 million. Comparable EBITDA improved by 4 per cent to EUR 179 million and comparable earnings per share by 8 per cent to EUR 0.56. Despite geopolitical challenges and increasing uncertainties, all of our businesses have had solid performance.
Our 5G expansion has now reached over 80 per cent of the Finnish population in over 180 municipalities. Together with Nokia and Qualcomm, we achieved another record, setting the fastest 5G uplink speed of 2.1 Gbps in a live demonstration in Finland, enabling ultra-high-performance, low-latency services. In Estonia, we succeeded in the 3.5 GHz band 5G spectrum auction and won the 130 MHz of spectrum that we were targeting. Elisa was first to launch 5G services with the 3.5 GHz frequency.
The international digital services business continued on its path of growth. In July, Elisa signed an agreement to acquire Cardinality Ltd, a UK-based global supplier of cloud-native data management, service assurance and customer experience analytics. Cardinality’s award-winning platform complements Elisa Polystar solutions, providing a full, network-wide automation solution with cost benefits.
We are focusing on sustainable business in accordance with our mission: a sustainable future through digitalisation. Elisa was noted on the Financial Times ranking of Europe's Climate Leaders for the second consecutive year. We continued our support for Ukrainian people in need with monetary donations and by e.g. providing prepaid subscriptions in Finland and Estonia. We have been an official partner of Helsinki Pride for years together with other telecom operators to promote diversity and inclusion.
We will continue to focus strongly on continuous improvement of the customer experience and quality. Increasing productivity, innovating and expanding our digital services internationally, creating value with data, and our strong investment capability continue to lay a solid foundation for competitively creating value in the future.
Outlook and guidance for 2022
Growth in the Finnish economy is expected to continue; however, the outlook for GDP growth has deteriorated from the beginning of the year. There are increasing levels of uncertainty relating to Russia's war in Ukraine, such as inflation and energy prices. Challenges in global supply chains may also result in uncertainties in volumes and prices. Competition in the Finnish telecommunications market remains keen.
Full-year revenue is estimated to be at the same level as or slightly higher than in 2021. Mobile data and digital services are expected to increase revenue. Full-year comparable EBITDA is anticipated to be at the same level or slightly higher than in 2021. Capital expenditure is expected to be a maximum of 12 per cent of revenue.
Elisa is continuing its productivity improvement development, for example by increasing automation and data analytics in different processes, such as customer interactions, network operations and delivery. Additionally, Elisa’s continuous quality improvement measures will increase customer satisfaction and efficiency and reduce costs.
Elisa's transformation into a provider of exciting, new and relevant services for its customers is continuing. Long-term revenue growth and profitability improvement will derive from growth in the mobile data market, as well as domestic and international digital services.
Disclosure procedure
Elisa is adopting the disclosure procedure enabled by the Standard 5.2b published by the Finnish Financial Supervision Authority. This is a summary of Elisa’s Half-Year Financial Report January–June 2022 and the complete report is attached as a pdf-file to this release and is also available on our website at elisa.com/investors.
ELISA CORPORATION
Additional information:
Mr Veli-Matti Mattila, CEO, tel. +358 10 262 2635
Mr Jari Kinnunen, CFO, tel. +358 10 262 9510
Mr Vesa Sahivirta, IR Director, tel. +358 50 520 5555
Distribution:
Nasdaq Helsinki
Principal media
elisa.com